Reviewing risk management tools for construction projects and the implementation of project management strategies

Purpose - The research reviewed risk management tools for construction projects and the implementation of project management strategies, in which prominence is found in the use of the integrated use of value management and risk management adapted from the Integrated Approach for Soft Value Management. The study was based on a school construction project which was used as a case study at which the researcher’s role is that of ‘Project Manager’. The project status before the study was that it was almost 100% behind schedule and experienced a wide variety of problems ranging from constant site shut-downs due to community protests, contract scope changes, poor quality workmanship and material related setbacks. The study, through literature review, considered some of the methods currently used in the built environment to mitigate unforeseen problems to construction projects and ascertained the extent to which these tools and techniques for risk management on construction projects were used. The idea behind this was to review, document and package the application of a project management strategy that would be suitably effective for resolving the problems faced on the project site. Design – The research design used in this study was the ‘Case study design’ and ‘Experimental design’ in which the ‘Action-research’ approach and ‘Embedded survey within a case study’ were employed on the construction project site, managed by the researcher in his capacity as Project Manager. This was done by organising role-players as participants in focus group workshops facilitated by the researcher where the participants interacted with the researcher and amongst themselves in an effort to identify and find possible problems affecting the project. The researcher introduced stimulating action to project management processes based on the information sourced from the literature review and data obtained from focus group workshops where the outcomes were observed, recorded, analysed and conclusions drawn. Results – The investigation results revealed that the applied management strategies in form of the approach adapted from the integrated use of value and risk management provided a conclusion that the approach was an effective and preferable technique to use in comparison with the commonly used contingencies and float for risk management on construction projects. The above processes also confirmed its relevance as an appropriate technique for risk management of most unforeseen problems which have an effect on the three constraints of time, cost and quality. A further analysis of literature reviewed, which was also supported by other studies previously undertaken, concluded that most professionals in the construction sector such as Quantity Surveyors, Construction Managers, Project Managers and Architects were aware of Value Management but rarely applied it on projects for risk management purposes. Practical Implications – Developing a standard model for the implementation of measures to deal or manage unplanned problems on a project is a challenge as most projects do not have a set model to deal with unforeseen project problems which compels the reliance on contingencies and float. However, any envisaged model must be supported by a quality control system which allows for easy implementation of interventions. The prototype step model conceptualised by the researcher is intended to enable project functionaries and project managers through its unique and easy steps to navigate through any problem which may be encountered on a project. This is regardless of the project phase in which such challenges manifest as there is no preferred model capable of resolving much more than one setback at any given time in comparison with the strategy recommended by this study, which may also be applicable to other sites where similar dynamics exist. Limitations – The study was conducted in a confined environment which required to be confirmed through longitudinal research which is broader and based on many different projects hence the results could not be generalised but only limited to the current project and further research was recommended. The single case study design was also a limitation as the results were not broad enough and were also subjective for generalisation to other project sites. Conclusion – This project management strategy in which the integrated value management approach was used has the potential of being employed as an intervention technique for unforeseen problems related to construction projects provided the processes derived from further research are documented and packaged into a process to be used as a standard model. The project management strategy has the potential to mitigate problems related to time, cost and quality only during the three phases of the project which are, initiation, planning, and implementation and excludes the closing phase to enhance project value. In iii essence, when the project cost and time are effectively managed and reduced, with enhanced quality, the result is an improved project with significant prospects of success

Quantifying the Impact of Change Orders on Construction Labor Productivity Using System Dynamics

Researchers and industry practitioners agree that changes are unavoidable in construction projects and may become troublesome if poorly managed. One of the root causes of sub-optimal productivity in construction projects is the number and impact of changes introduced to the initial scope of work during the course of project execution. In labor-intensive construction projects, labor costs represent a substantial percentage of the total project budget. Understanding labor productivity is essential to project success. If productivity is impacted by any reasons such as extensive changes or poor managerial policies, labor costs will increase over and above planned cost. The true challenge of change management is having a comprehensive understanding of change impacts and how these impacts can be reduced or prevented before they cascade forming serious problems. This thesis proposes a change management framework that project teams can use to quantify labor productivity losses due to change orders and managerial policies across all phases of construction projects. The proposed framework has three models; fuzzy risk-based change management, AI baseline-productivity estimating, and system dynamics to illustrate cause-impact relationships. These models were developed in five stages. In the first stage, the fuzzy risk-based change management (FRCM) model was developed to prioritize change orders in a way that only essential change orders can be targeted. In this stage, Fuzzy Analytic Hierarchy Process (F-AHP) and Hierarchical Fuzzy Inference System are utilized to calculate relative weights of the factors considered and generate a score for each contemplated change. In the second stage, baseline productivity model was developed considering a set of environmental and operational variables. In this step, various techniques were used including Stepwise, Best Subset, Evolutionary Polynomial Regression (EPR), General Regression Neural Network (GRNN), Artificial Neural Network (ANN), Radial Basis Function Neural Network (RBFNN), and Adaptive Neuro Fuzzy Inference System (ANFIS) in order to compare results and choose the best method for producing that estimate. The selected method was then used in the development of a novel AI model for estimating labor productivity. The developed AI model is based on Radial Basis Function Neural Network (RBFNN) after enhancing it by raw dataset preprocessing and Particle Swarm Optimization (PSO) to extract significant dataset features for better generalization. The model, named PSO-RBFNN, was selected over other techniques based on its statistical performance and was used to estimate the baseline productivity values used as the initial value in the developed system dynamics (SD) model. In the fourth stage, a novel SD model was developed to examine the impact of change orders and different managerial decisions in response to imposed change orders on the expected productivity during the lifecycle of a project. In other words, the SD model is used to quantify the impact of change orders and related managerial decisions on excepted productivity. The SD model boundary was defined by clustering key variables into three categories: exogenous, endogenous, and excluded. The relationships among these key variables were extracted from the literature and experts in this domain. A holistic causal loop diagram was then developed to illustrate the interaction among various variables. In the final stage, the developed computational framework and its models were verified and validated through a real case study and the results show that the developed SD model addresses various consequences derived from a change in combination with the major environmental and operational variables of the project. It allows for the identification and quantification of the cumulative impact of change orders on labor productivity in a timely manner to facilitate the decision-making process. The developed framework can be used during the development and execution phases of a project. The findings are expected to enhance the assessment of change orders, facilitate the quantification of productivity losses in construction projects, and help to perform critical analysis of the impact of various scope change internal and external variables on project time and cost

Market Structure and Energy Efficiency: The Case of New Commercial Buildings

This is a report on why commercial office buildings aren’t more energy efficient. Several decades of energy efficiency programs have resulted in some gains, but overall increases in the energy efficiency of buildings have fallen far short of the 30 to 50 percent improvement that many efficiency advocates believe is possible. The purpose of this study is to consider the “why” question by empirically examining the dynamics of new commercial building markets. To do so, the authors used multiple research techniques, including qualitative field observation and interview methods that allow for a more in-depth understanding of complicated market processes. Their research focused primarily on new office buildings and centered in four regional markets: Sacramento, San Francisco, Seattle, and Portland. The authors identify key dynamics of commercial office building markets, describe how change and innovation occurs in commercial development, discuss the implications for energy efficiency, and suggest next steps

Project pathogens: The anatomy of omission errors in construction and resource engineering project

Construction and engineering projects are typically complex in nature and are prone to cost and schedule overruns. A significant factor that often contributes to these overruns is rework. Omissions errors, in particular, have been found to account for as much as 38% of the total rework costs experienced. To date, there has been limited research that has sought to determine the underlying factors that contribute to omission errors in construction and engineering projects. Using data derived from59 in-depth interviews undertaken with various project participants, a generic systemic causal model of the key factors that contributed to omission errors is presented. The developed causal model can improve understanding of the archetypal nature and underlying dynamics of omission errors. Error management strategies that can be considered for implementation in projects are also discussed

Some results from a system dynamics model of construction sector competitiveness

Despite government-led good practice initiatives aimed to improve competitiveness in the U.K. construction sector, fluctuations in growth-driven demand, investment and constant regulatory revisions make it very difficult for an enterprise to plan strategically and remain competitive over a timescale exceeding 2 to 3 years. Research has been carried out to understand the historical evolution and changing face of the construction sector and the dynamic capabilities needed for an enterprise to secure a more sustainable competitive future. A dynamic model of a typical contracting firm has been created based upon extensive knowledge capture arising from fieldwork in collaborating firms together with a detailed review of the literature. A construct called the competitive index is used to model contract allocation in a stylised market. The simulations presented enable contracting enterprises to reflect strategically with a view to remaining competitive over a much longer time horizon of between 15 and 20 years. The rehearsal of strategy through simulated scenarios helps to minimise unexpected behaviour and offers insights about how endogenous behaviour can shape the future of the enterprise. To date, work on construction competitiveness has been either of a static nature or set predominantly at the level of the project. This study offers a new perspective by providing a dynamic tool to analyse competitiveness. It creates a new paradigm to support enhanced construction sector performance

Construction safety and digital design: a review

As digital technologies become widely used in designing buildings and infrastructure, questions arise about their impacts on construction safety. This review explores relationships between construction safety and digital design practices with the aim of fostering and directing further research. It surveys state-of-the-art research on databases, virtual reality, geographic information systems, 4D CAD, building information modeling and sensing technologies, finding various digital tools for addressing safety issues in the construction phase, but few tools to support design for construction safety. It also considers a literature on safety critical, digital and design practices that raises a general concern about ‘mindlessness’ in the use of technologies, and has implications for the emerging research agenda around construction safety and digital design. Bringing these strands of literature together suggests new kinds of interventions, such as the development of tools and processes for using digital models to promote mindfulness through multi-party collaboration on safet

New Zealand Building Project Cost and Its Influential Factors: A Structural Equation Modelling Approach

Construction industry significantly contributes to New Zealand's economic development. However, the delivery of construction projects is usually plagued by cost overruns, which turn potentially successful projects into money-losing ventures, resulting in various other unexpected negative impacts. The objectives of the study were to identify, classify, and assess the impacts of the factors affecting project cost in New Zealand. The proposed research model was examined with structural equation modelling. Recognising the lack of a systematic approach for assessing the influencing factors associated with project cost, this study identified 30 influencing factors from various sources and quantified their relative impacts. The research data were gathered through a questionnaire survey circulated across New Zealand construction industry. A total of 283 responses were received, with a 37% response rate. A model was developed for testing the relationship between project cost and the influential factors. The proposed research model was examined with structural equation modelling (SEM). According to the results of the analysis, market and industry conditions factor has the most significant effect on project cost, while regulatory regime is the second-most significant influencing factor, followed by key stakeholders' perspectives. The findings can improve project cost performance through the identification and evaluation of the cost-influencing factors. The results of such analysis enable industry professionals to better understand cost-related risks in the complex environment